It looks like Twitter will be left to the swamp, after all.
In a SEC filing, Tesla CEO Elon Musk confirmed that he is terminating his $44 billion acquisition of Twitter. According to Musk, the social media company had failed to provide ample information about the fake accounts on the platform.
Twitter shares promptly dropped 7% in after-hours trading. This is no surprise, as Twitter’s value without Musk is marginal at best.
In a filing, Musk’s lawyers stated that Twitter had refused or failed to respond to multiple requests for information on fake or spam accounts, according to a Reuters report. The information is fundamental to Twitter’s business performance, according to Musk.
“Twitter is in material breach of multiple provisions of that Agreement, appears to have made false and misleading representations upon which Mr. Musk relied when entering into the Merger Agreement,” Musk’s lawyers wrote.
Musk had been pissed off about Twitter’s insistence that less than 5% of its users were fake accounts. This was obviously not true, so the Tesla CEO asked for proof. Twitter responded by providing access to its “firehose” data stream, but Musk’s team found this inadequate.
Musk’s decision to pull out of the deal is expected to result in a long protracted legal tussle between the Tesla CEO and the social media platform.
Twitter Board Chairman Bret Taylor issued a statement on the matter.
“The Twitter Board is committed to closing the transaction on the price and terms agreed upon with Mr. Musk and plans to pursue legal action to enforce the merger agreement. We are confident we will prevail in the Delaware Court of Chancery,” he wrote on Twitter.